First off, the pipe character is special in regular expressions so you need to escape it \|, second, your regular expression REQUIRES a pipe to be in the match... third you only allow one character after the pipe...

It works better like this

my @cities = $test =~ m/^'([^'|]+)/gm;
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the m modifier means match ^ to the beginning of any line, not just the string. So it matches a single quote at the front of a line and captures all characters after it that are not a pipe or a single quote.